Conventional Home Loans: The Complete Guide
Everything you need to know about conventional mortgages - from credit requirements and PMI to down payment options
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What is a Conventional Loan?
A conventional loan is a mortgage that is not backed by a government agency like the FHA, VA, or USDA. These loans follow guidelines set by Fannie Mae and Freddie Mac, making them the most common type of mortgage in the United States.
Conventional loans offer flexible terms and competitive rates for borrowers with good credit and stable income. They can be used to finance primary residences, second homes, and investment properties.
Conventional Loan Requirements
Credit & Income
- Minimum credit score of 620 (higher scores get better rates)
- Debt-to-income ratio typically below 45%
- Stable employment and income history
Down Payment & PMI
- Minimum 3% down for qualified buyers
- 20% down to avoid Private Mortgage Insurance (PMI)
- PMI can be removed once you reach 20% equity
Benefits of Conventional Loans
Competitive Rates
Access some of the most competitive interest rates, especially with good credit and 20% down payment.
Property Flexibility
Finance various property types including primary homes, second homes, and investment properties.
No Upfront Fee
Unlike FHA loans, conventional loans don't require an upfront mortgage insurance premium.
Ready to Get Started?
Compare rates, calculate payments, and take the first step toward your conventional loan.
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